NII subscription is a key indicator of market confidence and demand strength for any IPO. Here’s why it matters:
- Shows strong investor confidence – NIIs invest larger amounts than retail investors and study the company’s fundamentals before investment. So, high NII subscription reflects trust in the company’s growth potential.
- Improves IPO credibility – When NIIs participate actively, it creates positive sentiment in the market and encourages retail investors to subscribe as well.
- Boosts demand and valuation – Heavy NII demand can drive oversubscription, leading to better price discovery and potentially stronger listing gains.
- Indicator of listing performance – While not a guarantee, IPOs with strong NII subscriptions often perform better on listing day because large investors tend to support the stock in the secondary market too.
